Toyota to invest $1Bn in ride-hailing service Grab

Toyota Motors has agreed to invest $1 billion in Southeast Asian ride-hailing firm Grab as a lead investor in the company's ongoing financing round, which was launched after it bought Uber's Southeast Asia business.REUTERS | Updated: June 13, 2018, 10:04 IST

Toyota Motors has agreed to invest $1 billion in Southeast Asian ride-hailing firm Grab as a lead investor in the company's ongoing financing round, which was launched after it bought Uber's Southeast Asia business.

The investment by Toyota is the largest-ever by an automaker in the global ride-hailing sector, the company said in a statement on Wednesday.

It is also the latest collaboration between a global vehicle maker and a technology firm as ride-hailing companies dominate the fast-growing field of mobility services, raising the risk of a future where car ownership declines in favour of such services.

Japan's SoftBank Group last month announced it would invest $2.25 billion in the Cruise autonomous vehicle unit of General Motors, while Fiat Chrysler Automobiles and Jaguar Land Rover have agreed to supply vehicles for Alphabet's self-driving car subsidiary Waymo.

Toyota's investment will allow Grab, which counts peer Didi and Japan's SoftBank Group as investors, to further expand its range of online to offline services, such as food delivery and digital payments, deeper into the region. Grab will be valued at just over $10 billion after Toyota's investment, said a person familiar with the matter.

A Toyota executive will be appointed to Grab's board of directors and a dedicated Toyota team member will be seconded to Grab as an executive officer, the ride-hailing firm said.

As part of the investment, Toyota has installed its driving recorder devices in some vehicles operated by Grab, using the collected data stored in its mobility services platform to analyse driving patterns and develop vehicle services.

The automaker on Wednesday said by deepening the partnership, it hoped to achieve connectivity for Grab's rental car fleet across Southeast Asia and offer financing, insurance and maintenance services to drivers based on data collected on its platform.

"Going forward, together with Grab, we will develop services that are more attractive, safe and secure for our customers in Southeast Asia," Toyota executive Shigeki Tomoyama said in a statement.

Data collected from the recorders could also help Toyota in its own development of next-generation mobility services, including a self-driving electric vehicle it plans to develop for companies to use for tasks such as ride hailing, package delivery and mobile shops.

South Korea's Hyundai Motor and Japan's Honda Motor have also previously funded Grab, which said it has achieved run-rate revenue of over $1 billion. The company's app has been downloaded onto over 100 million mobile devices and the firm logs over 6 million rides per day.